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MTA Climbs Higher

Rates

The Monthly Treasury Average hasn’t seen a decline for six months now. The movement contrasts another index for adjustable-rate home loans that recently set a new record.

During October, the daily average of the yield on the one-year Treasury note was 0.18 percent, according to data provided by the Federal Reserve Board of Governors. The daily average has been the same for three months.

But the daily average was up sharply from October 2011, when it was 0.11 percent.

An average of all of the last 12 months comes out to 0.16583 percent — the MTA for October.

The index was 0.16000 percent in September and hasn’t had an improvement since April, when it fell to 0.14667 percent — a record-low based on Fed data back to 1953.

In October 2011, MTA was 0.20750 percent.

Competing with the MTA as an index for adjustable-rate mortgages, on a much larger scale, is the yield on the one-year Treasury note, which drifted from 0.17 percent at the end of September to 0.18 percent as of October’s close, according to the Department of the Treasury. The one-year Treasury yield, which is used as the index for the one-year ARM, closed Friday at 0.19 percent.

Contrasting the rise in the one-year Treasury yield and the MTA was the 11th District Cost of Funds Index — or COFI — which fell to an all-time low of 1.038 percent in September, according to data reported by the Federal Home Loan Bank of San Francisco.

In the U.S. Mortgage Market Index report from Mortech Inc. and Mortgage Daily for the week ended Nov. 2, ARM share of overall activity was near-comatose at 2.256 percent, barely moved from 2.495 percent in the prior week.

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